Enron Mail

From:shelley.corman@enron.com
To:steven.kean@enron.com, vicki.sharp@enron.com, drew.fossum@enron.com,maria.pavlou@enron.com, michael.moran@enron.com
Subject:Mkt Affiliate Implications: Reorganization of Houston and Omaha
Cc:
Bcc:
Date:Wed, 15 Nov 2000 00:58:00 -0800 (PST)

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Enron Energy Services is presently a marketing affiliate of several of the=
=20
Enron pipelines because EES: (1) buys/sells gas; and (2) holds transport=20
contracts on our pipelines. =20

Under the FERC's standards of conduct, the pipelines cannot: (1) share=20
transportation information or shipper information with EES; (2) must functi=
on=20
independently and keep separate books and records. Generally, I don't see=
=20
the FERC having any problem with mechanical, electrical, air-conditioning=
=20
types of services. However; there are 2 specific concerns that arise with=
=20
respect to the described arrangement under the FERC's marketing affiliate=
=20
standards of conduct:

1. Records -- FERC has ruled that giving a marketing affiliate "access" to=
=20
transportation and shipper records (including something as simple as file=
=20
room access) is deemed to be impermissibly sharing the information with a=
=20
marketing affiliate in violation of the standards. Thus, it seems to me tha=
t=20
EES will explicitly not be able to perform any records management function=
=20
for NNG, TW or NBPL.

2. Billing - FERC scrutinizes intercompany charges carefully. In a recent=
=20
Kinder-Morgan consent order, the FERC used payroll and intercompany charge=
=20
records to make the case that the pipeline and marketing affiliate did not=
=20
operate separately. It would be helpful if any EES facility management=20
charges/allocations come from Enron Facility Services (not EES) -- leaving=
=20
us room to argue that the facility management subsidiary involves separate=
=20
functions and staff than the EES subsidiary that is a marketing affiliate.




=20
=09
=09
=09From: Steve Kean & Bill Donovan 11/14/2000 06=
:36 PM
=09

Sent by: Enron Announcements
To: All Enron Houston
cc: =20

Subject: Reorganization of Houston and Omaha Facilities Management=20
Responsibilities


Responsibility for daily operations of building support services in the=20
Enron Building, Houston leased offices, and Two Pacific Place (Omaha) will =
be=20
transitioning from Corporate to Enron Energy Services (EES) by year-end. T=
he=20
areas affected include facility operations and maintenance of mechanical,=
=20
electrical, and air-conditioning systems; mail delivery; housekeeping; =20
food, copier, and records services.

This transition of services, as presently managed by Enron Property and=20
Services Corp. (EPSC), is designed to optimize value to Enron=01,s Business=
=20
Units by leveraging facility management businesses now offered by EES to=20
their commercial customers. EPSC staff having administrative responsibilit=
y=20
for these services will report to Enron Facility Services, a subsidiary of=
=20
EES=01,s Global Energy Services group led by Daniel Leff, President and CEO=
.

EPSC is responsible for Enron=01,s internal real estate and office developm=
ent=20
needs, including leasing, space allocations and facility planning, project=
=20
and construction management, furniture systems, and office relocation. EPS=
C,=20
in its development role, remains a part of Enron Corporate Administration=
=20
Services (ECAS) along with Corporate Security and the Aviation Department,=
=20
reporting to Bill Donovan, Vice President, Corporate Administrative Service=
s.

This alignment of responsibilities offers the opportunity for EPSC to focus=
=20
resources on effective utilization of our existing office space assets and=
=20
managing the development of Houston=01,s new Enron Center Campus project.